Content providers struggle with online advertising

TORONTO — Internet specialists say they’ve done a pretty lousy job of promoting themselves as a viable advertising medium.

At a panel of Toronto Internet specialists held by the Internet Advertising Bureau of Canada on

Tuesday, executives discussed a variety of marketing techniques using demographics, permission-based e-mail and search engines.

“”I think we’ve been unsuccessful as an industry in communicating this medium as an advertising tool,”” said Ted Boyd, president and CEO of Iceberg Media, an independent radio portal. The Internet accounts for 10 per cent of media usage in Canada, but only one per cent of corporate advertising dollars, he said. “”That gap will decrease massively, but only when the message can be communicated.””

Iceberg has had some success in generating ad revenue by targeting audio ads to its listeners by database demographics rather than relying on IP-based delivery, he said. The Iceberg site requires users to submit their date of birth, gender and postal code and will send them appropriate ads accordingly. Boyd said the demographic data his firm has collected is reasonably accurate, coming within five to 10 per cent of data generated by Statistics Canada. Users generally find it easier to tell the truth than bother making up registration information, he said. Even if only a fraction of a postal code is provided, it can provide valuable information.

Alex Nichols, who has worked with Look Communications and, stands by permission-based e-mail as a tried and true method of advertising. Once you have a user’s e-mail, you have a point of contact, he said. Nichols also uses peer-to-peer media files as a method of distributing advertising material. Music videos, television content, movies and so on are tagged and made freely available online. Once a user downloads the tagged material he or she will also be the recipient of ads. The ads replicate themselves, effectively, when they are swapped back and forth by the online community.

Nichols freely admits that he will always be competing with unauthorized “”untagged”” material, “”but given the choice, people will take content directly from the source . . . because they’re getting the highest quality and relevant advertising,”” he said.

A third online advertising pundit suggested search engines are still one of the best ways to get a company noticed. Wayne Cowan, president and CEO of Incubator Interactive Inc., provides an optimization service to get a site noticed by big directories like Yahoo! and big search engines like Google.

“”If you’re not on the top of the list, then you may as well be 700 pages back, because no one’s going to find you,”” he said. “”If you want to be No. 1 on Google, then your site has to be optimized for Google.””

By itself, a well-designed site won’t necessarily get noticed by a search engine, he added. Web spiders, the tools that scour the Internet for new sites, won’t read Flash pages, for instance.

Much of online advertising comes down to trust, noted Boyd. “”I’m not sure the user wants to think we get together in a closed room to figure out (how we share data),”” he said. It’s far better to have separate user registrations for each site, he said, so that users can be assured of having a “”contract”” in place.

At the end of the day, panelists agreed the Internet has failed to capitalize on its potential as an advertising outlet. Back in the mid-1990s, Nichols conducted a study and determined that if a company the size of PepsiCo. had spent just a fraction of its advertising budget on the Internet, it could have had a banner on practically every Web page.

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Jim Love, Chief Content Officer, IT World Canada

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